Senate votes for NJ Democrats’ $31.7B budget proposal

The state Senate today passed the Democrats’ proposed state budget by a predictable party-line vote, sending it one step closer to an unpredictable reception by Gov. Chris Christie.

The governor has been advocating for a tax cut since February, but the $31.7 billion budget that Democrats approved 24-16 in the Senate, sending it to the Assembly for consideration, doesn’t include one. Instead it creates a $183 million reserve that can be deployed for a reduction in taxes six months from now — if Christie’s revenue projections, which some consider too optimistic, are being reached.

“This budget plans for a tax cut. It doesn’t necessarily have to commit for it today, but the tax cut is part of this budget,” Sarlo said. “This is a responsible budget that is guided by economic reality, not by anyone in those house or anyone in this state’s political ambition.”

Sen. Anthony Bucco, R-Morris, the top Republican on the budget committee, said Democrats found $140 million in line items to cut in order to add Democrats’ policy priorities to Christie’s budget plan but are “impounding just about the same amount” budgeted for the first year of a phased-in tax cut.

“In my mind, we should be giving that money back to the taxpayers first,” Bucco said. “… Two years ago, everyone here in Trenton was sent a message. The voters had rejected ‘government first, taxpayers second’ economic policy, the one under which New Jersey government grew while the private sector shrunk. They don’t want higher taxes. They want us to cut taxes.”

“This budget treats taxpayers as an afterthought, the orphans of New Jersey,” said Sen. Joseph Pennacchio, R-Morris, who said that government spending is being green-lighted while a tax cut is being held in reserve. “… Taxpayers thought they finally had a seat at the table. Unfortunately, the only thing the taxpayers are getting from this budget is the bill. I urge the governor to re-prioritize this budget. Take out your red pen, governor. Let’s put taxpayers first.”

Christie had proposed a 10 percent, across-the-board cut in income tax rates that would have been phased in over three years. Democratic lawmakers said that would favor the rich and instead advanced a plan to provide a credit against income taxes equal to 10 percent, or even 20 percent, of property taxes, with high-income households excluded. Christie agreed to that approach — but now that’s on hold, too, pending tax collections.

Democrats also plan to advance a millionaires tax and pair it with an increase in property tax credits, particularly benefiting senior citizen and disabled homeowners.

“We shouldn’t be raising taxes on anybody, but the millionaires tax is really about sharing,” said Sen. Ronald Rice, D-Essex.

Sarlo said he has concerns that Christie is projecting unrealistic revenue growth, and fellow Democratic Sen. Barbara Buono said — three times, in fact — that Christie was being “stubbornly delusional” by not moderating or negotiating revenue projections, which are notably higher than those of nonpartisan legislative analysts.

“I am concerned about the revenue estimates that we’re relying on because they are beyond the realm of reality,” said Buono, D-Middlesex, who said the increased surplus is a hedge against the inevitable spending cuts that will be needed if revenues fall short of forecast.

“Nothing will be lost for the taxpayers by being patient. The plan isn’t scheduled to take effect until next January, so we should use the six months between now and then to gauge the economy and monitor state revenues,” Sarlo said. “This schedule may not satisfy the governor’s political timeline, but it is the responsible thing to do for New Jersey.”

Debate in the Senate on the FY13 budget bill lasted only 38 minutes.

In other budget-related votes cast so far today:

Senate voted 37-3 to make various changes needed to balance the FY2012 budget, which wraps up on Saturday, including nearly $257 million in extra appropriations and $86 million in funding reductions.

Senate voted 24-11 to authorize the Supreme Court to raise some fees, with proceeds being used to fund an ‘e-court’ digital upgrade for the judiciary and Legal Services of New Jersey.

Senate voted 27-11 to provide nearly $7.5 million in supplemental appropriations for family planning services and require the state to extend Medicaid coverage for such services to people with incomes of less than twice the poverty level. Three Republicans backed the bill: Diane Allen, Kip Bateman and Jennifer Beck.

Senate voted 24-13 to provide more than $4.1 million in supplemental appropriations to school districts with significant enrollment growth.

Senate voted 38-2 to move certain personnel management responsibilities from the Department of the Treasury to the Civil Service Commission.

The Senate hasn’t yet taken up related bills that are part of the budget compromise reached by Democrats in the Senate and Assembly, such as higher taxes on income in excess of $1 million, a corresponding increase in property tax credits, the reversal in tax year 2012 of cuts made in 2010 to the earned income tax credit and the first step of an increase in state aid, from energy taxes, to municipalities.

The Senate also hasn’t yet voted on budget-related legislation that reflects parts of Christie’s original proposal, such as making drug courts mandatory for all nonviolent offenders, at least on a pilot basis in a few counties, and shuffling around the Sports & Exposition Authority and senior services.

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About Michael Symons

Michael Symons has covered seven governors while working in Gannett's Statehouse Bureau -- a stint which actually only stretches back to 2000, but the door revolves quickly in New Jersey politics. He's co-author of the biography "Chris Christie: The Inside Story of His Rise to Power."

About the Authors

Bob JordanBob Jordan has covered state, county and muncipal governments for the past 10 years. He has also covered the gaming industry and has been a sports team beat writer for NHL, NBA and major league baseball teams.E-mail Bob

John SchoonejongenJohn Schoonejongen is state editor for Gannett New Jersey newspapers. He has reported and edited at New Jersey newspapers from Salem County to Passaic County, writing about everything from state politics to lost pigs on the Delaware Memorial Bridge. Born in Camden County, he still speaks with a southern New Jersey accent, much to his wife's annoyance.E-mail John

Michael SymonsMichael Symons has covered seven governors while working in Gannett's Statehouse Bureau -- a stint which actually only stretches back to 2000, but the door revolves quickly in New Jersey politics. He's co-author of the biography "Chris Christie: The Inside Story of His Rise to Power."E-mail Michael